Gigabit or 100 Mbps? Largest U.S. ISPs Make Different Choices

Why is Comcast, the largest U.S. internet service provider, pushing to make gigabit service available to all its customers, while Charter Communications, the second-largest ISP, only will sell 100 Mbps?

In each case, the decisions reflect strategic choices about what is required in their markets. Charter, the second-largest ISP, takes a minimalist approach at least in part because many of its systems are in rural areas where 100 Mbps is a top-of-the line service. Comcast, on the other hand, operates mostly in big-city markets where competition from other gigabit providers can be expected.  

That does not mean those suppliers actually expect most consumers to buy their fastest service. In fact, they probably expect that most consumers will not do so. But those expectations also drive thinking about how much investment, and what type of investment, to make it their current generation access platforms.

That is true in other markets, as well.

In the United Kingdom, direct fiber connections on at least one access link remain a small fraction of total internet access connections is about two percent, according to U.K. government estimates. All-copper digital subscriber lines account for 44 percent or so of total connections; fiber-to-curb about 34 percent; and cable TV connections about 21 percent of total.

Speeds of Broadband Technologies as seen in December 2016 (ordered by median speed)
Provider	Ratio of tests	Down Speed of bottom 10% Mbps	Median Mbps	Mean Mbps	Median Upload Mbps	Mean Upload Mbps	Down Speed of top 10% Mbps
FTTH/FTTP	1%	16.7	49.1	72.6	16.3	32	160.1
Cable	20.6%	8.9	43.4	52.4	5.4	6.4	104.9
VDSL2/FTTC	33.9%	13.3	30.1	31.8	7.1	7.6	51.9
Mobile	N/A (*)	2.3	14.5	21.3	3.1	4.4	46
Fixed Wireless	0.14%	3.1	14.3	27.8 (**)	2.1	14.2 (**)	55.4
Satellite	0.04%	1.6	12.2	12.9	0.1	0.3	25.3
ADSL/ADSL2+	44.3%	1.1	5.5	6.8	0.6	0.6	14.8
(*) Mobile was not included in the proportion of tests as the assumption is the majority of the tests are people who have a fixed line option too. (**) We advise caution on these two wireless mean speeds, as they appear skewed to due a small number of tests that are symmetric and in the 200 to 300 Mbps region, this may be people testing connected via Ethernet to a mast or as one or two fixed wireless providers suggest they provide Fibre to the Premises in a small part of their footprint.

source: Thinkbroadband

In the United States, cable TV companies lead, in terms of speeds, for most consumers, even if independent providers and telcos support fiber-to-home networks. In the third quarter of 2016, cable operators had 63 percent of the installed base of fixed internet connections, and have added virtually all the net new accounts (more than 100 share of new accounts), as they  have been for a few years.

That means that cable access platforms will use hybrid fiber coax (fiber plus copper), even if others (AT&T, Google Fiber, independent ISPs) deploy fiber to home networks. Cable operators use HFC because they can: gigabit speeds are possible on the standard hybrid networks. Telcos and independent ISPs must opt for FTTH to supply gigabit speeds.

Over the next couple of years, all of Comcast’s customers (Comcast is the largest U.S. ISP) will be able to buy gigabit service, and many of the other leading cable operators will be making that same move. For the moment, Charter Communications, the second biggest ISP, will hold top speeds to about 100 Mbps, across all its territories, though some customers (former Time Warner Cable customers) might be able to buy 300 Mbps.

In rural areas, fiber to home might not always be possible, but cable hybrid fiber coax networks might. That is important because the industry-standard DOCSIS 3.1 platform supports gigabit service on standard HFC cable networks.

The point is that decisions about “speed” vary, even between the largest and number-two U.S. ISPs. So do decisions about “minimum viable” access platforms.